Berger’s Pants on Fire

In an extended letter to the editor in the Raleigh News & Observer, Senator Phil Berger makes the stunning claim that most people who would be eligible for the Medicaid expansion are already covered by private insurance. He refers to an unnamed academic study in support of that position:

Their researchers found that only 14 percent of new Medicaid recipients would come from the ranks of the uninsured, while as many as 80 percent are currently covered by private insurance.

As I was scratching my head wondering where Berger got these figures, Don Taylor was blogging a response over at freeforall. The study referred to was authored by colleagues of his in Boston. Here’s Don’s response:

[Berger] cites a study conducted by researchers from Boston University and Harvard, two of whom are friends and colleagues of mine (and I used to blog with them). I asked the studies lead author what he thought of Senator Berger’s claim based on his research, and here is what he (Steve Pizer) wrote to me:

Although it’s true that Medicaid expansion nationally will result in substantial numbers of individuals moving from private to public insurance, in a state like North Carolina this will be much less of a problem. North Carolina has relatively high uninsurance rates and currently restrictive Medicaid eligibility policies. This means new Medicaid enrollees in North Carolina will have lower incomes and be more likely to be uninsured than in many other states. In related research with the same colleagues as the study cited by the Senate President, we demonstrated that low-income individuals with chronic health conditions like diabetes and asthma and/or disabilities like difficulty walking are disproportionately likely to be uninsured in states with restrictive Medicaid eligibility policies like North Carolina. The proposed Medicaid expansion would be an effective means to reduce uninsurance in this vulnerable population as well as among the low-income population more generally.

In other words, the Medicaid expansion will be more efficient at covering the uninsured in some states as compared to others. States with relatively low eligibility standards will get more insurance bang out of the Medicaid expansion than others. North Carolina is one such state, simply because our current Medicaid eligibility levels are so low (a childless adult can NEVER qualify for Medicaid today in North Carolina,no matter how low their income; see table 3). In Massachusetts, the Affordable Care Act is in many ways is irrelevant because of what the state had already done, for example. Not so in North Carolina, because of what we have not done by way of voluntary Medicaid expansions.

The NCIOM’s Uninsured Snapshots, reporting data from the U.S. Census Bureau, show that in 2010-11, there were 648,000 non-elderly uninsured with family incomes less than 138% of the FPL, the cutoff for Medicaid expansion under the ACA. These are folks who, in some other states, would not be uninsured because they could have qualified for Medicaid under more generous eligibility rules in those states. Because North Carolina has quite low eligibility limits, we have left more adults uninsured. The 648,000 non-elderly adults comprise the pool from which the Medicaid expansion population would be drawn. Some of this 648,000 would not qualify for Medicaid because they don’t meet the citizenship or other requirements. Others wouldn’t enroll — the 500,000 figure is a rough estimate of how many would eventually enroll in the program. And Senator Berger should note that these uninsured aren’t lazy loafers. Of the nearly 1.6 million uninsured in North Carolina, all but about 21% had at least one employed person in the household. 24% have one or more full time worker in the household.

Without Medicaid, these uninsured will keep going to the emergency rooms where they will not pay anything. So the rest of us will pay more to cover this uncompensated care. And it will be delivered in the most inefficient way possible.